From Rags to a Roof Over Your Head

Muhammad Yunus has finally won The Nobel Prize for Economics. It’s about time.

*   *   *   *   *   *   *   *   *   *   *   *   *   *   *


I no longer remember when I first read his book. I know I found it in the “New Books” section at the library, probably in the late 1990s. Having worked with poor women in the past, the dust jacket intrigued me, so I put the book into my stack of borrowings.

Banker to the Poor: Micro-Lending and the Battle Against World Poverty was so memorable that some time later I bought the book myself. And I began to make donations to Dr. Yunus’ project.

As I recall from my reading, he studied economics, having returned to Bangladesh after getting his doctorate in the US. He sent his students out to study poverty in Chittagong, and based on their papers, he became interested in finding a way to get around the usurious money-lenders that poor women were forced to bargain with in order to buy the materials they needed to make crafts – baskets, chairs, etc., – to sell at the market, only to turn around and give most of it back to the money lenders in a vicious and seemingly unbreakable cycle.

Dr. Yunus realized his great big doctorate wasn’t doing any good if he couldn’t use it as a lever to change the economic conditions of the very poor, the desperately poor, in his country. As I recall from the book, he started small – his own money, and less than a hundred dollars. This was long before “Grameen Bank” was a fully formed idea, much less a successful enterprise. All he wanted to do, originally, was to intervene in a fundamentally unjust situation.

As anyone who has worked with the poor and marginalized knows, it does no good to play Dr. Bountiful. So there had to be rules about how much money could be borrowed, when it would be repaid, and who would supervise the program. Dr. Yunus would set up micro (and I do mean micro) loans to craftswomen in order to free them from the money lender schemes. Improvising as he went along, he had the women join small groups of other borrowers. They met to discuss business methods, repayment plans, and just to encourage one another. This took courage, both on the part of Dr. Yunus and his first borrowers; the moneylenders were not happy with this new arrangement.
– – – – – – – – – –
All of the above is what I recall from reading the book. Considering my retention rate on what I read (which is nil), it is obvious Dr. Yunus made quite an impression on me. Now, this from his website:

The origin of Grameen Bank can be traced back to 1976 when Professor Muhammad Yunus, Head of the Rural Economics Program at the University of Chittagong, launched an action research project to examine the possibility of designing a credit delivery system to provide banking services targeted at the rural poor.

That’s amazing, considering the ink had barely dried on Yunus’ doctoral degree when he began his research on the problem. However, he wasted no time and things were shortly up and running:

The action research demonstrated its strength in Jobra (a village adjacent to Chittagong University) and some of the neighboring villages during 1976-1979. With the sponsorship of the central bank of the country and support of the nationalized commercial banks, the project was extended to Tangail district (a district north of Dhaka, the capital city of Bangladesh) in 1979. With the success in Tangail, the project was extended to several other districts in the country. In October 1983, the Grameen Bank Project was transformed into an independent bank by government legislation. Today Grameen Bank is owned by the rural poor whom it serves. Borrowers of the Bank own 90% of its shares, while the remaining 10% is owned by the government.

There is a strong moral foundation to Grameen. In addition to signing on to the repayment requirements, there are “The Sixteen Decisions of Grameen Bank.” All of them are geared toward self-improvement, community responsibility, and family health.

Sixteen DecisionsHere is Number Twelve, entitled “We shall not inflict any injustice on anyone, neither shall we allow anyone to do so.” To me, this illustration is meant to portray the old moneylenders and how they harmed those who used their services. It reminds members not to fall back into the cycle which had kept them in grinding poverty. It wasn’t for nothing that Grameen won The Fast Company/Monitor Social Capitalist Award for 2005 and 2006:

The Fast Company/Monitor Social Capitalist Awards is the only award program that quantitatively measures a non-profit group’s innovation and social impact, as well as the viability and sustainability of its business model. Grameen Foundation has twice been recognized for its groundbreaking work in expanding the reach of microfinance around the world while applying innovative technology to increase efficiency and provide new opportunities for the poor.

It is also has a Four Star Charity Navigator rating. In other words, this is an idea worth your money.

Grameen is slowly becoming a global phenomenon. It is even here, in the US, in two projects. As I recall from my original reading, when Dr. Yunus first came to America to explain his project and to recruit the poor, his ideas didn’t/couldn’t translate to government bureaucrats used to “working with” the poor. They sent him small business projects, not poor single parents trying to make a go of things with a craft or talent they thought might be marketable. It took a few years for Grameen (“the village”) to translate into American economic terms. For an example of how it can work cross-culturally, read Kevin’s story.



A several-days-late hat tip to Eteraz via email: You thought I didn’t know about this wonderful man, didn’t you? See, even a jihadiphobe can have a Muslim hero. I knew about Dr. Yunus long before I ever heard of the evil CAIR or the Ummah. Long live Grameen – capitalist to the core.

17 thoughts on “From Rags to a Roof Over Your Head

  1. Did I miss somtething? I thought Mohammed Yunus won the Nobel Peace prize not the one on Economics.

    I have no comment on the achievements of this man, but some Economics commentators have already expressed their opinion about the economic sanity of his activities.

    Yunus’s activities may be admirable, but they mostly have a social engineering dimension in the way that they enable women to have more control of their lives. Of course, in a muslim country this is essentially a good thing.

  2. And in a non-muslim country, that would be a bad thing? Curious.

    Anyway, you are correct – he won the peace prize. Confusion is understandable – the Nobel peace prize committee, very much unlike the one for economics, is not known for its intelligent choices. Thank G-d they didn’t give it to Cindy Sheehan – she was already dusting off a place on her mantel for it.

  3. I’m not putting words in your mouth, I’m just trying to make sense of this statement:

    “Yunus’s activities may be admirable, but they mostly have a social engineering dimension in the way that they enable women to have more control of their lives”

    “but” implies a contrast with admirable. The second clause is about enabling women to have more control of their lives. That implies to me that it is other than admirable to enable women to have more control of their lives.

    My apologies if I misunderstood your intention.

    I will look at the article you referenced. Please use HTML links.

  4. Here’s the criteria from Nobel’s Living Will:

    According to Nobel’s Living will, the Peace Prize should be awarded “to the person who shall have done the most or the best work for fraternity between the nations, for the abolition or reduction of standing armies and for the holding and promotion of peace congresses.”

    His award is not even a stretch; that being said, this is their business, not mine. If they want to give the award to penguins, it’s ok by me (and more fitting, these days).

    EU Referendum opined that the US Marines would be a great candidate, considering the terms of the will.

  5. I read the mises.org post linked above, and was surprised by its crabby tone. If it is true that most of the funding is from governments and public international agencies (as opposed to purely private ones), then there is something to lament in it.

    And yet it is indisputably true that when women have more control over their destinies, they are less subject to the cruelties of the surrounding culture. No less a radical feminist than Margaret Thatcher used to suggest this when she argued that the primary advantage of money is not the things that it buys but the control that it gives you over your life.

    It is also true, in my view anyway, that the promotion of commercial activity itself as a force for peace. The more people are knit together by common self-interest, the less likely they are to begin attacking one another. (This is an other-things-equal claim, not a naive panacea.) And the more virtues ordinary Bangladeshis see in free commercial activity, the more they might rise in opposition to restrictions on it. That Mr. Yunus saw this amidst the socialist hellhole that Bangladesh was (and perhaps still is) is to his credit. But since Bangladesh is, according to Transparency International, tied with Chad as the most corrupt country on the planet, Grameen’s work is necessary but far from sufficient.

  6. Surely “social engineering” and “[enabling] women to have more control over their lives” — especially if the latter project results in abortion, declining marriage patterns, deteriorating relations between the sexes, and falling birth rates — are less than admirable positions.

  7. Right – keep ’em barefoot and pregnant. They wouldn’t know what to do with freedom anyway.

    (that’s irony, folks).

    I’m just a wee bit scornful of the implied argument that allowing a degree of “control” to women undermines society. Doesn’t that kind of thinking belong on the other side of the jihad? Or is the alternative to sharia some kind of “Handmaid’s Tale” fantasy? I don’t think Dymphna is signing up for that one.

  8. Surely “social engineering” and “[enabling] women to have more control over their lives” — especially if the latter project results in abortion, declining marriage patterns, deteriorating relations between the sexes, and falling birth rates — are less than admirable positions.

    What if it results in fewer honor killings, less wife-beating, less serial adultery and polygyny and more responsible financial behavior by many husbands? Is that an argument in its favor, other things equal?

  9. “Doesn’t that kind of thinking belong on the other side of the jihad?”

    Not at all. Don’t be absurd. The alternative to feminism, the grave results of which we are seeing today, is NOT sharia, polgyny, wife-beating, etc.. Feminism or sharia, it’s a false dichotomy.
    And anyway, “that kind of thinking,” as you put it, is merely the thinking that enabled our fathers, grandfathers, great-grandfathers, et al., to marry and have children and populate the West without importing millions of alien populations. They were doing something right, weren’t they? Or perhaps you’re one of those who think our ancestors were jihadists whose progeny deserve to die off?

  10. Strange … by now I would have thought most intelligent people would understand that overpopulation is one of the root causes for poverty in third world countries. There have always been horrible, tragic consequences to having too many children to support adequately. And as usual, the children are the ones who suffer the most for it. Is it unreasonable to expect parents to just have enough children to replace themselves? Three is within reason. But 4, 5, 6, 7, 8 and more when you’re poverty-stricken? That’s when the “virtue” of reproduction becomes madness.

  11. Nony, in such cultures having a large number of children was, until very recently, the only way to guarantee income and survival in old age. Half of the kids a family might have used to die before they reached 1 year old, so that’s half of your population growth gone already. A large proportion of the rest would die as they grew up, leaving you with two or three that survive to adulthood.

    The reason these populations are gerowing so fast is because they’ve had access to western medicine and technology without an accompanying change in their culture. Children are still seen as the only way to keep things going, so they don’t stop at two or three but keep going, just in case.

  12. Grameen is not about “empowering women.” Read the 16 Decisions linked in the post: it is about changing how communities live. After all, that’s what “grameen’ means: community. People being responsible for and to one another. The drawings accompanying the Decisions are for the members who are illiterate. I found the simple pastels attractive.

    Please read Yunus’ book. He was as surprised as anyone by the success of his idea, but the motive force was to undermine the power of the moneylenders, who were in control. It’s like driving the mob out of the neighborhood.

    His work in America is an attempt to tailor it to the needs here, which are different, but no less ingrained. Again, see the link to Kevin’s story in the post.

    In the US, we have venture capitalists. Among the poor, we have micro-lenders. Both are crucial to the expansion of capitalism and the improvement of markets.

    And yeah, I am a ditz. It was the Peace Prize. It shoulda been the prize for Economics, though. So I’ll just re-arrange reality for the moment.

    I’d be proud to leave behind a legacy like Dr. Yunus’…he has touched so many lives. And, btw, touched off more than a few family squabbles as women start being able to support their chidlren THRU THEIR OWN EFFORTS. That is very different than the idea of entitlement money. The mindset that each program creates could not differ more radically.

    I like the idea of Bangladesh teaching underclass Americans how to get out from under such toxic largesse.

Comments are closed.